Analyzing Obalon Therptcs (OBLN) & China Kanghui Holdings (KH)

Obalon Therptcs (NASDAQ: OBLN) and China Kanghui Holdings (NYSE:KH) are both medical companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, analyst recommendations, dividends, profitability, risk, institutional ownership and earnings.

Analyst Ratings

This is a summary of current recommendations and price targets for Obalon Therptcs and China Kanghui Holdings, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Obalon Therptcs 1 0 2 0 2.33
China Kanghui Holdings 0 0 0 0 N/A

Obalon Therptcs currently has a consensus target price of $12.00, suggesting a potential upside of 49.25%.

Insider and Institutional Ownership

44.7% of Obalon Therptcs shares are held by institutional investors. 16.4% of Obalon Therptcs shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Obalon Therptcs and China Kanghui Holdings’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Obalon Therptcs $3.39 million 41.36 -$20.46 million ($1.99) -4.04
China Kanghui Holdings N/A N/A N/A $0.72 N/A

China Kanghui Holdings has higher revenue, but lower earnings than Obalon Therptcs. Obalon Therptcs is trading at a lower price-to-earnings ratio than China Kanghui Holdings, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Obalon Therptcs and China Kanghui Holdings’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Obalon Therptcs -459.54% -59.77% -47.02%
China Kanghui Holdings N/A N/A N/A

Obalon Therptcs Company Profile

Obalon Therapeutics, Inc. is a United States-based commercial-stage medical device company focused on developing and commercializing medical devices to treat obese and overweight people by facilitating weight loss. The Company’s product, Obalon balloon system, is a swallowable, gas-filled intragastric balloon designed to provide weight loss in obese patients. The Obalon balloon system is intended to be used as an adjunct to a moderate intensity diet and behavior modification program. All balloons must be removed six months after the first balloon is placed. The Obalon balloon system intends to provide patients and physicians with a reversible and repeatable weight loss solution in an outpatient setting, without altering patient anatomy or requiring surgery. The Company has received Premarket approval (PMA) for its Obalon balloon system based on the results of its United States pivotal clinical trial, referred to as the SMART trial.

China Kanghui Holdings Company Profile

China Kanghui Holdings is a holding company and conducts all of its business through its two wholly owned subsidiaries in China, Changzhou Kanghui Medical Innovation Co., Ltd. (Changzhou Kanghui) and Beijing Libeier. The Company is a domestic developer, manufacturer and marketer of orthopedic implants in People’s Republic of China. The Company’s orthopedic implant brands are Kanghui and Libeier. It sells two lines of orthopedic implant products, trauma and spine. Its major trauma products, used in the surgical treatment of bone fractures, include a range of nails, plates and screws. Its major spine products, used in the surgical treatment of spine disorders, include screws, meshes, interbody cages and fixation systems. On July 31, 2008, we acquired 100% of the equity interests of Beijing Libeier. On July 31, 2009, the Company established Shanghai Zhikang Medical Devices Co., Ltd. (Shanghai Zhikang), which is wholly owned by Changzhou Kanghui.

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